Decline in Revenues of Large Commercial Enterprises in Greece
The Hellenic Statistical Authority recorded a marginal decrease in the revenues of the country’s large commercial enterprises for the month of May, raising concerns about whether accuracy is starting to affect the overall trend of consumption and GDP. The total revenues of wholesale and retail trade companies – which also include the activity of repairing motor vehicles and motorcycles – amounted to 11.2 billion euros in May, registering a marginal decline of 0.4%.
May 2023 VAT Declarations Show Increase in Total Revenues
In May 2023, total revenues reached €11.252 billion, according to data from the Hellenic Statistical Authority. These figures are collected from VAT declarations submitted by companies that keep double-entry books, providing detailed information on the overall turnover, at least the “apparent” turnover.
Of particular interest is the turnover of the trade sector, as it provides an initial indication of consumption trends. Despite expectations of increased prices impacting consumer behavior, the data suggests a steady flow of revenue in the sector.
The Core of Economic Activity in Greece
Consumption, despite the focus on investments and exports, remains the core of economic activity in Greece, contributing to nearly 70% of the GDP. This year, the trends in consumption compared to last year could potentially lead to an increase in business volume, which is clearly influenced by price levels. However, for May, this is not the case, and it remains to be seen if this could be a precursor to a restriction in private consumption overall.
Analysis of Private Consumption and GDP in the Second Quarter
At the beginning of September, we will have a complete picture of the trajectory of private consumption (as well as the general GDP trajectory in the second quarter). However, recent announcements by ELSTAT regarding income trends and the Ministry of Finance’s report on tax revenue in June have raised concerns about a potential freeze in economic growth.
It is worth noting that in June, there was no significant increase in tax revenue, particularly from VAT, indicating that we may be facing challenges ahead. Stay tuned for more updates on the economic situation in the coming months.
Decrease in Business Revenue in May Compared to April
Overall, businesses keeping double-entry books showed a modest increase in revenue of about 1.5% in May compared to the same month last year. The total revenue reached 30.839 billion euros, up from 30.395 billion euros in May 2023.
April was a much better month with total revenue of 32.44 billion euros. This year, we are seeing a phenomenon where revenue has decreased in May compared to April, while last year May was much better than April, with total revenue of 30.39 billion euros, compared to 27.9 billion euros in April.
May 2024 Business Trends
In May 2024, businesses in the Accommodation and Food Services sector saw the largest increase in turnover compared to May 2023, with a growth of 14.8%. On the other hand, businesses in the Electricity, Gas, Steam, and Air Conditioning Supply sector experienced the biggest decrease in turnover, dropping by 9.8%.
Revenue Breakdown
Revenue in the Accommodation and Food Services sector surpassed the one billion euro mark this year, reaching 1.054 billion euros from 918 million euros last year, representing a 14.8% increase.
Analysis of Tourism and Energy Consumption Trends
This year, the increase in tourism is evident, with the Easter holiday falling in May contributing to the boost. This double-digit growth indicates a promising year for the tourism sector, potentially reaching a new historical high. On the other hand, a decrease in revenue for electricity and gas companies is observed, attributed to lower retail prices compared to last year, a trend that persisted until June.
It seems that the month of May, characterized by lower prices in the energy sector, has impacted the overall revenue stream for these businesses. Despite the fluctuating trends in different sectors, the tourism industry appears to be on a positive trajectory for the year, setting a hopeful tone for the months ahead.
Analysis of Industry Trends
The industry of manufacturing has seen a slight decrease in revenue this year, dropping to 1.9025 billion from 2.135 billion last year. However, there is a high likelihood that we will see increased revenues again, especially in July and August, similar to previous years (in April 2023, revenue was 2.78 billion).
The processing sector, on the other hand, closed May with an increase in revenue to 7.4 billion, up from 7.25 billion last year. In the Transport and Storage sector, revenues reached 1.67 billion, with a marginal increase of 0.9% compared to last year. In Information and Communication, revenues amounted to 1.12 billion, up from 1.087 billion last year, with a growth rate of 3.2%.
